On Monday the government showed data, which indicated a decline in retail inflation up to 5.91 percent in March over the previous month. One of the main reasons behind this is the fall in the prices of food, fuel, and transport because of the coronavirus outbreak.
n February 2020, the retail inflation was around 6.58 percent and in March 2019 it was around 2.86 percent as per the Consumer Price Index. As per the CPI data released by the National Statistical Office, in March 2020, the food basket saw inflation of 8.76 percent, which was lower from 10.81 percent in the last month.
By deciding on the bi-monthly monetary policy, the Reserve Bank of India (RBI) mainly factors in retail inflation.
The government has made it mandatory for all the central bank to keep inflation rate around 4 percent.
The inflation rate of vegetables for the month of March stood at 18.63 percent against 31.61 percent. Whereas for the month of February the inflation rate of cereals and products stood at 5.30 percent for March against 5.23 percent a month ago.
There was inflation of 15.85 percent in the month of March for pulses and products which stood against 16.61 in the month of February. There was a downfall of 9.15 percent in the price of meat and fish against 10.2 percent a month ago.
In the category of fuel and light, for the month of March, the inflation was observed at 6.59 percent which stood against the previous month with 6.36 percent.
On March 27, RBI took a decision to cut the repo rate by 75 basis points to 4.40 percent versus 5.15 percent earlier.
On Monday, the RBI addressed that it will be using proper steps to start growth and ensure financial stability and also look forward to fighting the adverse effects of COVID-19.
Das stated that on the inflation front, the outlook has changed drastically. The governor added on to it that necessary steps are being taken up, to fight the adverse effect of coronavirus. RBI released the minutes of the MPC meet; Das stated that the global macroeconomic situation has been hit hard in the previous days.